(News Bulletin 247) – The in vitro diagnostics specialist delivered satisfactory activity in the second quarter. But its contributing current operating margin leaves the market unsatisfied.

During this half-year results season, the market did not hesitate to sometimes severely punish groups that delivered good overall copies but with a small negative point (such as Edenred or EssilorLuxottica, for example).

This is the case this Friday with the specialist in vitro diagnostics Biomérieux. The Lyon-based group has certainly published satisfactory activity.

Over the first half as a whole, the company’s revenues increased by 6.8% in published data to 1.77 billion euros. On a like-for-like basis, growth amounted to 8.3% – a figure described as “cannon” by Invest Securities – including a 2% increase in the prices of its products. According to a consensus posted by the company, analysts were expecting organic revenue growth of just 7%.

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A not so strong ROC

Growth accelerated in the second quarter alone, standing at 9.2% like-for-like, at 864 million euros, more than the 820 million euros expected by Invest Securities.

“The outperformance compared to our expectations is mainly due to microbiology (+17.9% like-for-like in the second quarter against 8% expected by Invest Securities) which capitalizes on strong growth in reagent sales across all key ranges and on the MDx franchise (+6.1% like-for-like over the quarter against -2% expected by Invest Securities) thanks to the growth of non-respiratory panels”, dissects the research office.

“The group’s pace in molecular biology, post Covid, is remarkable, especially since the basis for comparison in the second quarter was demanding (+30% like-for-like in the second quarter of 2022)”. Molecular biology thus progressed by 6.1% over the quarter.

But further down in the group’s accounts, profitability is disappointing. Current operating profit (COI) contributed fell by 9.5% over one year to 291 million euros in the first half, for a corresponding margin of 16.5% against a rate of 19.4% a year earlier. However, according to the consensus published by the company, analysts were counting on a contributing ROC of 303 million euros for a margin of 17.3%.

Profitability was penalized by an increase in commercial and general expenses, which represented 28.4% of revenue compared to 26.6% in the first half of 2022.

At constant rates, these expenses “increase by 14.9%, mainly due to the gradual return to the level of marketing expenses before the pandemic and the growth in salary expenses, including in particular the impact of the success of the employee shareholding plan. worldwide MyShare”, explains Biomérieux. The employee share ownership plan represented a total cost of 10 million euros.

Confirmed goals

Net profit fell 29% to 162 million euros, against 228 million euros a year earlier.

Regarding its outlook, Biomérieux has confirmed its objectives for the 2023 financial year. Excluding currency and perimeter effects, the company expects sales growth of between 4% and 6%, as well as a contributing ROC of between 600 and 630 millions of euros. Analysts are counting on organic growth of 4.2% and a contributing ROC of 617 million euros.

On the Paris Bourse, the Biomérieux share suffered and lost 2.8% to 92.9 euros around 10 a.m., showing one of the largest drops in the SBF 120.

“Despite disappointing margins in the first half, the tireless growth dynamic seems reassuring to us from a long-term perspective,” nevertheless underlines Invest Securities.

TP ICAP Midcap, for its part, maintained its buying advice, citing “the expected growth of the topline (the turnover, editor’s note) & of the contributing ROC from 2024, the defensiveness of the model, the acquisitive capacity and valuation levels.